Rumor: Apple in Talks to Buy Streaming Music Service Lala

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Rumor: Apple in Talks to Buy Streaming Music Service Lala

Apple could be knocking on the door of Lala, an online music service, with plans to buy out the Palo Alto-based startup.

Two anonymous sources told Bloomberg they could not be identified because talks are still in progress. The terms of the deal are unknown. However, if the rumor is true, it suggests Apple is thinking about its next competitive move in digital music, with the emergence of cloud-based audio services such as Pandora and Last.fm.

Lala allows customers to listen to songs on their site once for free. Then, customers have two options: to pay 10 cents to listen to songs from Lala's online servers, or to pay 79 cents to download a song onto their computer hard drive.

On a similar subject, Cult of Mac in August reported that Apple was building a 500,000-square-foot data center in North Carolina. Rich Miller, editor of Data Center Knowledge, speculates that given its enormity, Apple's data center would most likely focus on cloud computing — hosting services or data over the web. If the acquisition pans out, perhaps Lala's service would be integrated into this new data center to support Apple's gigantic iTunes customer base.